We've been asking ourselves recently if the market has placed a fair valuation on Ionis Pharmaceuticals. Let's dive into some of the fundamental values of this Large-Cap Health Care company to determine if there might be an opportunity here for value-minded investors.
Ionis Pharmaceuticals Has Elevated P/B and P/E Ratios:
Ionis Pharmaceuticals, Inc., a commercial-stage biotechnology company, provides RNA-targeted medicines in the United States. The company belongs to the Health Care sector, which has an average price to earnings (P/E) ratio of 22.94 and an average price to book (P/B) ratio of 3.19. In contrast, Ionis Pharmaceuticals has a trailing 12 month P/E ratio of -40.7 and a P/B ratio of 18.03.
Ionis Pharmaceuticals has moved 86.5% over the last year compared to 16.2% for the S&P 500 — a difference of 70.3%. Ionis Pharmaceuticals has a 52 week high of $74.42 and a 52 week low of $23.95.
The Business Is Unprofitable and Its Balance Sheet Is Highly Leveraged:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (k) | $1,122,599 | $729,264 | $810,456 | $587,367 | $787,647 | $705,138 |
| Operating Margins | 33% | -24% | -4% | -70% | -45% | -67% |
| Net Margins | 25% | -61% | -4% | -46% | -47% | -64% |
| Net Income (k) | $278,143 | -$444,263 | -$28,597 | -$269,722 | -$366,286 | -$453,897 |
| Net Interest Expense (k) | $12,440 | $9,510 | $9,349 | $8,122 | $12,660 | $16,994 |
| Depreciation & Amort. (k) | $12,540 | $13,365 | $15,487 | $14,328 | $10,292 | $9,614 |
| Diluted Shares (k) | 153,303 | 139,612 | 160,340 | 141,848 | 143,190 | 149,514 |
| Earnings Per Share | $1.9 | -$3.18 | -$0.2 | -$1.9 | -$2.56 | -$3.04 |
| EPS Growth | n/a | -267.37% | 93.71% | -850.0% | -34.74% | -18.75% |
| Avg. Price | $64.97 | $54.17 | $40.86 | $35.3 | $50.59 | $71.64 |
| P/E Ratio | 32.48 | -17.03 | -204.3 | -18.58 | -19.76 | -23.57 |
| Free Cash Flow (k) | $314,722 | $772 | $18,844 | -$290,091 | -$331,318 | -$546,227 |
| CAPEX (k) | $30,905 | $35,120 | $11,955 | $15,721 | $23,805 | $45,280 |
| EV / EBITDA | 24.03 | -48.41 | -336.5 | -14.95 | -23.7 | -24.6 |
| Total Debt (k) | $785,500 | $539,112 | $59,713 | $1,194,233 | $1,308,360 | $1,253,062 |
| Current Ratio | 9.97 | 3.56 | 9.75 | 7.07 | 5.9 | 8.47 |
Ionis Pharmaceuticals has declining EPS growth, negative cash flows, and High Levels of Debt. On the other hand, the company has an excellent current ratio of 8.47 working in its favor. Furthermore, Ionis Pharmaceuticals has declining revenues and increasing reinvestment in the business.
